Burma’s Bumpy Road

YANGON — Allan Lokos and Susanna Weiss, two New Yorkers who run a meditation center on the Upper West Side, arrived in Myanmar in December 2012 eager to explore a nation just emerging from decades of military rule. As practitioners of Theravada Buddhism themselves, visiting this largely Buddhist land, with its golden pagodas and crimson-robed monks, was more than just a holiday.

They left with Lokos barely clinging to life, 30 percent of his body badly burned, after Air Bagan flight 011 crash-landed near Inle Lake, a top tourist destination at the foot of the Shan Hills in central Myanmar, on Christmas Day.

Story Continued Below

Twenty months into an arduous recovery process, Lokos is back teaching and writing, albeit with badly damaged hands. And in May, Air Bagan and its controlling company, the Htoo Group of Companies, quietly agreed to settle a $10 million personal injury lawsuit brought by the couple. Neither side will discuss the terms, though the couple’s attorney, Eric Rose of Herzfeld, Rubin, Meyer & Rose — one of the first American law firms to arrive in Myanmar since a quasi-civilian government took hold in 2011 — says it is “sizable” by U.S. standards.

That Lokos is alive is remarkable, given the grim prognosis many doctors gave him. But the aftermath of the crash is also a small window into the much-heralded but still-awkward détente between the United States and Myanmar, also known as Burma.

That’s because the founder of Air Bagan is Tay Za, a 50-year-old tycoon who has claimed to be Myanmar’s richest businessman and remains, to his detractors, the most infamous crony of the former junta, which showered its allies with lucrative contracts.

Tay Za has been on a U.S. Treasury blacklist since 2007, and most of his business interests, which range from mining and logging to hotels and aviation, have also been placed on the list since that time. That means U.S.-linked companies can’t do business with them without permission from Treasury’s Office of Foreign Assets Control, or OFAC.

U.S. ties to this former pariah state—which was once so isolated that mobile phone access cost more than $2,500—have thawed considerably, with Secretary of State John Kerry arriving here Aug. 9 for a regional summit and President Obama set to visit, for the second time, in November. These days, street vendors selling papayas and lottery tickets dodge the ever-growing traffic on once-empty downtown streets, middle-class residents stay glued to Facebook—and Yangon citizens protest everything from rising electricity prices to land-grabbing near City Hall.

But U.S. policies toward some of Myanmar’s top magnates, many of whom are still on OFAC’s Specially Designated National (SDN) list, complicate the relationship. Even as the Obama administration eases other sanctions, the list is a headache for many U.S. companies in Myanmar, where it’s difficult to avoid blacklisted local firms. The SDN has helped keep American money largely on the sidelines as Asian and European rivals move in, much to the chagrin of U.S. businesses eager to cash in on one of the world’s last untapped markets. Human rights advocates counter that the list preserves U.S. leverage as American concerns rise about the uncertain fate of democratic reforms, and violence against minority Muslims.

It’s rare that sanction politics affect the average American. But in this case, Treasury rules meant that Weiss and Lokos needed permission from Treasury to pursue compensation and ultimately sue, a process that drew support from the State Department and other officials.

Moreover, Tay Za, like some other tycoons in Myanmar’s long-isolated economy and its murky legal system, has rarely faced the legal challenges sure to come as the country opens to the world.

The couple’s understanding is that the Obama administration raised the issue — a sensitive one, given Tay Za’s SDN status — when Myanmar President Thein Sein visited the White House in June 2013. A State Department official would not confirm that, citing privacy considerations, saying only that “the State Department regularly assists U.S. citizens affected by transportation disasters abroad.”

Still, among the many people Lokos and Weiss are grateful to – a local good Samaritan named Myoe Myoe Htet, their Singapore surgeon, the U.S. consular officials who found them in a local hospital – they include the man a Treasury official once called “an arms dealer and financial henchman of Burma’s repressive junta.”

Without Tay Za’s help after the crash, they say, Lokos would be dead.

***

Susanna Weiss was standing outside the burning wreckage of the Fokker 100 aircraft when she realized she might not see her husband of 22 years again.

On its approach to Inle Lake, their aircraft had sheared through power lines and landed, hard, in a field more than a mile short of the airport, killing their local tour guide and a nearby motorcyclist. The crash was later attributed, in part, to a misjudgment by the pilot.

As smoke engulfed the plane, Weiss jumped out the emergency exit and through a screen of fire. As Lokos tried to jump out himself, his left foot got caught — on what, he still doesn’t know.

“I kept screaming for Allan and he didn’t appear,” Weiss, who suffered broken vertebrae herself, told POLITICO in a phone interview. “It was the first of several times I thought he must be dead.”

Within the next minute or so, Lokos emerged from the plane, sheets of burnt skin hanging from his hands and legs. Hours later, at an ill-equipped hospital nearby, Tay Za entered the picture.